A major French department store turns to the web for more sales

The Galeries Lafayette chain is stepping up investments in e-commerce.

Franck Zayan, director of e-commerce for the Galeries Lafayette Group, says France’s bricks-and-mortar retailers are finally starting to see the potential in e-commerce.

“For a very long time businesses like Galeries Lafayette kept e-commerce at arm’s length,” Zayan says. “They really felt that it was in-store where they made their sales, and where customers would always come to them.”

Now he says a change is underway, at least at Galeries Lafayette, which launched a new e-commerce site at galerieslafayette.com this month.

The Galeries Lafayette Group, which operates brands including a nation-wide chain of over 60 Galeries Lafayette department stores, as well as BHV and Monoprix stores, is focusing on generating more web sales, Zayan says.

Since Zayan joined in 2011, he has developed an e-commerce team of around 50 web professionals recruited from web-only retailers like Pixmania and the eBay online marketplace. Galeries Lafayette wants web sales to represent 15% of bricks-and-mortar store sales within the next five years, says Zayan— a former AOL employee, who co-founded online shoe retailer Sarenza.com in 2004.

The company has not released its current web sales. However, web sales for Galeries Lafayette and its other brands, which include BHV, Monoprix, and Louis Pion Royal Quartz, totaled $71.2 million in 2011, according to Internet Retailer Top 400 Europe Guide estimates. Galeries Lafayette says that it started focusing more on e-commerce just as its web sales began growing more quickly; total sales for Groupe Galaries Lafayette in 2011 were 3.7 billion euros (US $4.73 billion). “After Galeries Lafayette realized it really had to get into e-commerce, we put a lot of resources towards it,” he says. The brand invested in updating its e-commerce platform and hired web professionals, he says.

Galeries Lafayette has been testing e-commerce since 2008, when it launched a retail site for its Galeries Lafayette department store brand—but only recently began dedicating major resources to the channel—starting with galerieslafayette.com.

The retail site offers web-only discounts and offers of up to 50% off luxury clothing labels, shoes and bags.The new site also allows consumers to pick up items they have bought online in stores and also return web orders to stores. To better compete with web-only merchants, galerieslafayette.com is offering free delivery for orders over 100 euros (US$129), excluding UPS shipping.

Galeries Lafayette has plans to continue enhancing its web strategy , but it would not offer details. It also plans to sell more products it offers in stores, such as gourmet food, via its e-retail site as well.

French retailers that want to compete online should be prepared to invest in technology and in hiring personnel with web expertise, Zayan adds.

He notes examples set by chains such as the U.S. chain Nordstrom, which says it plans to invest nearly $1 billion over the next five years on developing its e-commerce infrastructure.